Note: Running most Fridays in FromGregsHead.com, is a continuing series of tips brought to you by Greg Price. These run Saturday mornings during the BusinessMaker’s Radio Show on KPRC 950AM. Audio files can be found on the Entrepreneur’s Playbook page of the PKF Texas website.
Houston is a booming international marketplace. International expansions can be particularly tricky. Over the last couple of weeks you’ve heard about some common complications and surprises. Here are two more:
You can setup business in a foreign country and get going quickly if you need to.
Wrong. Setting up a business in many foreign countries can be a complicated and lengthy process. In the US, legal entities can be created and ready to operate in as little as a week or less. In many other countries there are very bureaucratic and cumbersome processes for creating new entities so that it can often take weeks or months. And you often cannot proceed further until your company is formed.
I only have to worry about audits by the tax authorities.
Wrong. Many foreign countries require so-called statutory audits. These audits are performed by outside certified accountants, primarily to support tax reporting and collection. In some countries, auditors may be required to certify that the company’s taxes are all properly reported and paid, and may be subject to sanctions from the tax authorities if problems are later found.